Wachovia Forsakes Downtown for Midtown

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The relocation will be made when Wachovia's planned $14.3-billion acquisition of SouthTrust is completed later this year or early 2005, industry consultants tell GlobeSt.com. The bank's lease at Peachtree Tower expires in 2008. That means Wachovia will be subleasing most of its vacated space, brokers say. Downtown class A office rent averages $21.06 per sf, according to locally based Colliers Cauble Co. research. Average asking Midtown rent is $22.22 per sf.

"This is a situation where the bank's lease could be bought out before its expiration date by the owner or developer of a new building or even by principals at an existing building," a Midtown broker who may be involved in future negotiations on similar deals, tells GlobeSt.com.

Wachovia's relocation plans are bad news for Chicago-based Equity Office Properties Trust Inc., owner of the 191 Peachtree building. Two major bank tenants have previously announced plans to also move to Midtown. The 191 Peachtree building is currently 94.1% leased and occupied. It has 224,000 sf available and will have an additional 153,000 sf ready to rent after Nov. 20 from expected tenant relocations."

King & Spalding has leased 440,000 sf at Hines Co.'s 41-story, 681,000-sf tower under construction at Peachtree and 14th streets, as GlobeSt.com previously reported. The Hines building is expected to be ready for occupancy in December 2005.

The 500-lawyer Powell, Goldstein, Frazer & Murphy firm plans to vacate a total 200,000 sf at the 191 Peachtree Building and the 230 Peachtree Building. Powell Goldstein will be moving to the 50-story One Atlantic Center, formerly the IBM Tower, on 14th Street in Midtown.